The Secret to Buying Foreclosure or Bank Owned Real Estate

I?m often asked ?How can I buy property in foreclosure??  It?s relatively simple, but there are many, many things to consider.  You?ll need to have cash available.  There is no financing on these types of sales.  You?ll need a cashier?s check made out in an amount equal to what you are willing to pay for the property.  The banks publish a date when properties are going up for auction or sale.  You?ll have a few weeks to get prepared.  Then it?s off to the courthouse steps to bid for the home.  There will be other bidders and the competition is stiff.  A couple of the bidders are fierce competitors.  These are the professional foreclosure buyers looking to make money off buying low and hoping they can fix it and sell them fast for a profit.  The more people at the auction, the higher the price of the property may go. This is why you?ll want to do your homework well in advance.  All sales are final.  There are no after sale contingencies at all!  Your homework may include? What?s the property worth today?  What repairs are needed?  Is there anything really big wrong with it?  Unfortunately, the properties are often occupied and you never get a chance to see inside and do the proper inspections.  So, it comes down to what risks you?re willing to take.  Some other things to consider may be?Are you acquiring any liens on the property?  How about any tenants or the former owners?  Are they still occupying the home?  Most are very spiteful and literally destroy the interior and/or exterior, costing you $1000?s of unexpected repairs.  Will you have to evict the occupants and what are the costs involved?  Will you be able to refinance it to get your cash out of it?  After factoring in all the above points?Are you still getting a good deal?  Once, you?ve done your homework and know what you?re bidding on and feel somewhat comfortable with your conclusions, you move forward and bid.  It?s very risky.  It can be a rough way to go and you can lose money if your planning and/or assumptions are wrong or off a little.

Now, if the home isn?t sold at auction the lender gets it back. They normally price them very competitively, often below the market and sell them through real estate agents like me.  These are called bank-owned or REO (real estate owned). listings.  Before offering these homes for sale, they remove the occupants and make sure they can transfer a clear title to the new buyer.  These often are offered at better prices to make up for any repairs that may need to be done.  As a buyer, you get to complete all the physical type inspections you need and want.  Financing is available on these purchases like any other home you?d buy.  These REO?s offer buyers the benefit of getting a good value along with a lot less risk and hassle.  Plus, you have the Realtor?s help and experience to assist you with the proper inspections, financing and legal disclosures.  

If you have interest in buying a bank-owned property or REO, please call me and let?s go over all the details.  My name is John DiMassa.  Contact me now at Century 21 Amber Realty in Torrance at (310) 261 6268 or email me at John@soldbyc21.com.

Should I wait to Buy?

 John (310) 261 6268

January 3, 2007

Prices will not drop like the stock market.  It's just not the same.  Everyone predicted a huge drop in home values last year and it did not happen.  In Torrance, the average sales price for all the homes sold in 2005 was $734,000.  In 2006, the average sales price was $744,000.  It is certainly not going up like the past few years, but it is certainly not crashing. 

Buying nows offers you lower rates, better prices, more choices and the ability to negociate sales prices down.  Plus, buy now and save big money with interest rate deductions.  This alone can save you thousands of dollars per year!  In the long range future, history has taught us prices will go up!  You have to live some where, stop making your landlord rich and start owning it! 

posted 11/21/2006

2005 California housing market eclipses previous records

LOS ANGELES (Dec. 28, 2005) ? The California residential real estate market in 2005 will be one for the record books, eclipsing the annual sales and median home price records set in 2004, according to the California Association of REALTORS? (C.A.R.).  Here are some highlights from 05 and a look ahead to 2006:

 - Sales of detached, existing single-family homes are expected to reach 635,000 in 2005, an increase of 1.8 percent over last year?s record sales of 624,700.  Sales are anticipated to decline by 2 percent in 2006.       

- 2005 will be a record year for home prices.  The median price of a single-family home in California crossed the $500,000 threshold for the first time in April 2005.  The annual median is expected to reach $523,150 in 2005 and increase 10 percent to $573,500 in 2006.  

- The median price of a single-family home increased by double-digits for the fourth consecutive year in 2005, though the pace of price appreciation slowed from the 18 to 21 percent annual gains of the previous three years to 16 percent  in 2005.

- California Association of Realtors?s Unsold Inventory Index averaged 3.3 months in 2005.  Inventory levels are expected to rise moderately in 2006 but will remain low by historic standards, fueling continued price appreciation in the California market. 

- The interest rate for a Fixed-Rate Mortgage (FRM) remained below 6 percent for much of 2005, only surpassing 6 percent in the last months of the year. For all of 2005, the FRM averaged 5.8 percent.  In 2006, the interest rate for the FRM is projected to increase but remain low by historic standards in the low- to mid-6 percent range. 

Leading the Way...Realtors in California real estate for 100 years, the California Association of REALTORS? is one of the largest state trade organizations in the United States, with more than 180,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

2006 Housing Market Outlook 

Low interest rates and new loan products have unleashed the state?s demographic forces in recent years and enabled the California housing market to reach new heights 4 years in a row. The state is poised to establish new records for sales and the median price in 2005, stretching the longest housing market uptrend to ten years. The market and economic fundamentals of recent years will remain mostly intact in 2006, giving rise to a cautiously optimistic outlook for the year to come.

So what lies in store for 2006? The market and economic conditions that gave rise to an outstanding 2005 performance will generally prevail again in the year to come and contribute to another very good year:

? Steady but moderate economic growth accompanied by improvements in the labor    
  market  and low inflation
? Rising but still very favorable interest rates along with continued use of innovative real 
  estate financing options.
? Current and long-run demand forces continuing to encounter supply constraints

With inflation in check, fixed rates in 2006 should increase only slightly and fall in the low- to mid-6 percent range. Adjustable rates, which rose moderately in 2005 in response to increases in the federal funds rate, should also increase slightly in 2006. Overall, the interest rate environment will remain favorable for the year. However, with high home prices, more and more households will need to stretch their purchasing power with innovative forms of financing in order to buy a home in 2006.

While the unsold inventory index is expected to increase somewhat in 2006, current inventory levels will remain lean enough to drive continued price appreciation in the year ahead.  Meanwhile, new home building will again fall short of household growth in 2006, resulting in a long-run housing shortfall that will contribute further to higher home prices.